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VoIP is quickly replacing old phone systems

In the past, employees solely used voice technologies to communicate with colleagues, clients and partners. And while the presence of video conferencing, instant messaging and social media have driven the demand for unified communications, the business phone system is still among the most effective and popular methods of collaboration in and outside the workplace.

During the last several years, however, the standard office phone system has evolved to be more functional, flexible and scalable, allowing for more traffic without impairing call quality. To meet these demands, telephony had to migrate away from the conventional land line connection and adopt IP technologies. This inevitably gave rise to voice over IP, commonly referred to as VoIP.

Enterprise VoIP services have quickly been gaining momentum in the private sector, largely because of the numerous benefits the technology provides over traditional collaborative platforms. A recent report by Infonetics Research highlighted the increasing demand for VoIP and IP multimedia subsystems. Although this particular market has experienced turbulent growth throughout the last several years, it generated more than $800 million in revenue in the fourth quarter of 2012.

VoIP accounted for nearly two-thirds of the profits generated for the period, Infonetics noted, suggesting that organizations may be making the transition to IP phone systems.

"As we predicted, after three years of annual declines, the carrier VoIP and IMS equipment market turned the corner in 2012, growing 9 percent over the previous year due to strong IMS sales," said Diane Myers, principal analyst for VoIP, unified communications and IMS at Infonetics Research. "It's still early days for IMS equipment and applications for LTE, but a handful of operators are placing orders that are positively impacting revenue."

Why are companies embracing new telecommunications?

While there are a number of phone system features that companies are on the lookout for today, the ability to support mobile workers is often cited as among the most important. This is especially crucial for companies looking to expand, support a remote workforce or implement bring your own device and other mobile policies.

"This is a taste of what's to come over the next few years as wireless operators step into voice over LTE (VoLTE) and [rich communication services begin] to roll out across multiple regions," Myers noted.

A separate study of roughly 175 small and medium-sized businesses by a VoIP service provider found that the top reasons for replacing an old phone system with VoIP were to reduce expenses, allow employees to work remotely and improve internal operations. Decision-makers also recognize VoIP's ability to improve contact center operations, making it a reasonable and effective solution to improve customer service.

"VoIP telephony is an attractive proposition, particularly for small and medium-sized businesses as they can dramatically cut operating costs, improve workforce productivity and enhance customer service without investing in expensive IT equipment," VoIP expert Tan Aksoy said. "VoIP offers a genuine long-term solution that is scalable and practical without taking risks - which in turn allows businesses to be more agile and responsive to customer needs."

In the coming years, enterprises and small businesses will both continue to adopt VoIP services in a traditional phone system's stead. This is because IP telephony offers a number of advantages that cannot be attained through legacy solutions, such as supporting a mobile workforce and leveraging a highly flexible communication platform.

Forward-thinking decision-makers who have not yet made the switch to VoIP will need to consider doing so soon if they want their companies to remain competitive.